- The Washington Times - Tuesday, October 23, 2001

NEW YORK Wall Street showed more signs of strength yesterday, rallying sharply on earnings reports that at best were satisfactory, not stellar. The Dow Jones industrials soared 172 points, shaking off a report indicating the economy needs more time to recover.
Analysts said investors are willing to look past poor profits and place bets that business will improve next year.
"People are more concerned at the moment about missing out on the market's next move up than suffering the next big decline," said Richard A. Dickson, an analyst at Hilliard Lyons in Louisville, Ky.
Still, despite yesterday's buying spree, there were signs that investors are somewhat cautious while becoming more bullish. Trading volume was lighter than normal, an indication that some players were sitting out the session.
The Dow closed up 172.92, or 1.9 percent, at 9,377.03, easily claiming its biggest point gain since companies began releasing third-quarter earnings in earnest last week.
The broader market also rose. The Nasdaq Composite Index climbed 36.77, or 2.2 percent, to 1,708.08. The Standard & Poor's 500 index moved up 16.42, or 1.5 percent, to 1,089.90.
The market added to the strides it has made since its sharp decline in the first week of trading following the Sept. 11 terrorist attacks. The Dow has risen 13.9 percent from its lowest close for 2001 set last month. The Nasdaq has risen 20 percent from its low; the S&P; 500, nearly 13 percent.
But analysts cautioned against reading too much into yesterday's upturn, saying the market's gains will continue be vulnerable until businesses and the economy show concrete signs of recovery. So far this earnings season, many companies have lowered their expectations or offered little information about future prospects.
"It's a tough market. It's not going straight up from here," said John C. Forelli, portfolio manager for the John Hancock Core Value Fund.
A key gauge of future U.S. economic activity also offered little reason for optimism yesterday, but it didn't thwart the market's advance. Economic activity decreased 0.5 percent last month, as the Sept. 11 terrorist attacks in New York and Washington weakened an already sagging economy, according to the New York-based Conference Board's Index of Leading Economic Indicators.
The market disregarded the decline, most likely because it met analyst expectations.
"In the absence of terrible news, the market wants to go up," Mr. Forelli said.
Winners included companies that beat earnings forecasts. Dow industrial 3M surged $5.22 to $107.39 after exceeding estimates by a penny a share.
USX-U.S. Steel rose $1.31 to $14.74 after reporting a loss of 22 cents a share, smaller than the 42-cent shortfall Wall Street expected.

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